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What is the relationship between actual and potential real GDP?
Risk-Loving Investors
Investors who prefer investments with higher levels of risk in anticipation of potentially higher returns.
Utility Function
A mathematical representation of how a consumer derives satisfaction from consuming goods or services, showing their preferences.
Aversion to Risk
The inclination to avoid taking risks, preferring safer or more certain outcomes over uncertain ones.
Risk Neutral
An investor who finds the level of risk irrelevant and considers only the expected return of risk prospects.
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